IPCC Report summary for NAB employees

The world’s leading climate scientists have released the sixth Intergovernmental Panel on Climate Change (IPCC) assessment revealing that continuing to burn fossil fuels could trigger catastrophic climate change within a decade.1 

Four takeaways of the IPCC’s 6th Assessment report include: 

1. Climate change is already wreaking havoc around the world. The decisions that governments and financial institutions like NAB make this decade will either lead us towards a liveable future for our children and grandchildren, or a future that is incompatible with well-functioning human societies.
2. There is no room for any new fossil fuel developments – including oil and gas – if we are to limit global warming to 1.5 degrees.⁴ Unfortunately, between 2016 and 2019, NAB lent more than $1 billion to projects that expand the polluting gas industry. The science is clear – NAB must stop financing fossil fuel companies and projects that are profiting from climate chaos.
3. There is a narrow path to avoiding climate catastrophe, but only through rapid and deep emissions reductions.² Now more than ever, NAB has a responsibility to do its part to ensure we avoid the worst impacts of climate change. 
4. Every fraction of a degree of warming matters to limit the dangers of climate change.³ This means that every fossil fuel project that NAB does not finance will make a difference for the people we love, and even more so for our children and grandchildren.

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“It’s high time that banks like NAB decided not to lend any more to new projects in fossil fuels,” – Rob Henderson, NAB former Economist.

Financing gas is inconsistent with the Paris Climate Accord and net zero emissions by 2050.

NAB has led the way in committing to aligning their lending portfolio with net zero emissions by 2050 and the Paris Agreement. The International Energy Agency (IEA) has modelled a pathway to net zero emissions by 2050 and their report states that investment in new fossil fuel supply is inconsistent with the pathway to net zero emissions.¹ It is explicit that this includes no new gas fields and that liquefied natural gas (LNG) facilities under construction or at the planning stage are not needed. It also flags that existing gas fields may be closed prematurely.²

The IEA report shows that new gas projects in Australia – including those in the Beetaloo Basin, the Canning Basin, the Narrabri Gas Project, and the Scarborough project and LNG processing facility – are not compatible with reaching net zero emissions by 2050 and should not be financed.

_{[1] International Energy Agency, 2021, “Net Zero by 2050: A Roadmap for the Global Energy Sector”, p 21.}

_{[2]  Ibid, p 102.}

Photograph: J David Ake/AP

It’s a risky investment.

Australian oil and gas companies wrote off $25 billion in assets in the first six months of 2020. In addition, Australian gas companies have lost between 50-70% of their value since 2011.

Already many of Australia’s key coal and gas export partners, such as South Korea, China, Taiwan and Japan, have committed to achieving net zero emissions by 2050-60. Analysis shows that over 80% of Australia’s top twenty trading partners have pledged net zero emissions by mid-century.³ These policies put a clear timeline on the end of coal and gas exports from Australia. It is clear that fossil fuel industries do not have a viable economic future in a carbon constrained world.

_{[3]  The Australian Financial Review, 9 February 2021, “Global climate action will reshape Australia’s trade”, available here.}